Gold Prices Plummet as Strong US Data Shifts Rate Hike Odds

Gold prices fell by nearly $100 an ounce to around $4,600 on Wednesday as investors digested a batch of stronger-than-expected US economic data.

The PCE price index rose 0.2% in July, exceeding forecasts for a 0.1% increase. Annual inflation reached 3.7%, slightly above the predicted 3.6%. Core PCE also increased by 0.2% month-over-month and 3.3% year-over-year, meeting expectations.

Markets are now pricing around a 60% chance of the Federal Reserve leaving interest rates unchanged next month, down from 64% before the data release, according to the CME FedWatch Tool.